Korean McDonald’s seeing supersized growth in sales

Ray Frawley

Even with the worldwide fervor for organic, healthy food and documentaries like “Super Size Me” singling it out as contributing to obesity, McDonald’s is having the last laugh in Korea.
In fact, Korea is lovin’ McDonald’s — company sales growth reached double digits in 2007, up 16 percent from the previous year, according to Ray Frawley, managing director of McDonald’s Korea, yesterday at a press conference marking the company’s 20th anniversary here.
“Our future in Korea is very strong,” said Frawley, adding that the company’s new initiatives, such as the 3,000 won ($3.10) lunch, 24-hour operations in select branches, the McMorning Menu and their trans fat-free French fries, have all contributed to the franchise’s success.
McDonald’s has been growing steadily since its launch here in 1988, with sales up 7 percent in 2005 and 10 percent in 2006. The company said that of the 37 markets in the Asia-Pacific region, the Middle East and Africa, Korea ranks No. 1 in customer and operating income growth.
McDonald’s said it has been keeping up with the global health trend, starting with the quality of its beef and introducing healthier choices like ogok, a multi-grain shake, and TFA-free fries. “We are not a fast food company. We are a quick-service restaurant,” said Frawley, explaining that safety control begins with the company’s network of beef suppliers in Australia and New Zealand.
The restaurant chain has also been making efforts to pull in a diverse pool of customers by introducing premium Lavazza coffee in its stores. They also swapped the plastic chairs for leather ones to give more of a cafe feel. Rival fast food chain Lotteria has also been following this trend. “We have been changing the image of our stores to create a mood similar to a cafe, geared toward the health-conscious as well as women customers,” said a representative for Lotteria.
The McMorning menu, launched in early 2007, has also spurred other chains, such as Lotteria, to launch morning menus. Burger King was the first fast food chain in Korea to introduce a morning menu, in the mid-1990s.
McDonald’s project for 2008 is home deliveries. “Since last October, the company has tested this delivery service at several restaurants in the Gangnam area and received positive feedback,” said Frawley.

By Cho Jae-eun Staff Reporter [jainnie@joongang.co.kr]